Over two thirds (68%) of landlords say they are now less likely to purchase an investment property if it has an EPC rating of below C – the level at which legislation is expected to be announced for all new and existing private rented sector properties from 2025 onwards, according to the newest Landlord Panel research report from business insight consultancy, BVA BDRC.
According to the latest Landlord Panel research report released by BVA BDRC, over two thirds of investors looking to purchase property in the UK stated that they would be less likely to purchase a property if it has an Energy Performance Certificate (EPC) rating of below C, as new legislation is expected to be announced for all new and existing properties in the private rented sector from 2025 onwards that states C as the minimum acceptable rating for a property to have.
Of the investors who were actively looking to purchase an investment property over the next 12 months, 59% of those surveyed stated that they would be specifically looking to purchase a property rated C or above, while just 29% of investors said they would be open to purchasing a property rated through D to E.
Surveying a total of 752 landlords throughout Q4 2022 regarding the impact the proposed EPC legislation would have on their investment portfolios, the BVA BDRC Landlord Panel research report states that almost two in every five rental properties did not currently reach the C level on its EPC rating and that those properties that fell below the level C would anticipate a cost of on average £9,000 per property to improve the energy efficiency in line with the EPC requirements to meet level C.
While two thirds of landlords said that they would carry any works necessary on their properties to improve its EPC rating and maintain its ability to be rented out, 1 in 5 landlords said that they would not carry out any works at all and would seek to sell or not re-let their property.
“It’s obvious from this research that existing landlords are not just far more aware of the EPC rating of their properties now, but they are actively making decisions based on those levels and are planning for a future in which many of them will have to spend money in order to improve those ratings. Previously, the EPC rating of a property made very little difference to its saleability or indeed the way landlords viewed it for purchase, but a combination of factors including the Government’s intended measures in this area plus of course a wider focus on energy efficiency, all things Green, and the cost of utility bills, has drawn this into a much sharper spotlight.” George Gee, Managing Director of Foundation Home Loans.
At Beech Holdings we have always put sustainability at the heart of everything we do and have won multiple awards for our dedication to green energy within our developments, including the Best Energy Efficient Refurbishment at the Environment and Energy Awards, Pioneer of the Year from the Renewable Energy Association, and being Commended in Energy Excellence by the Energy Institute.
With our ongoing dedication to sustainability remaining at the forefront of our approach to development, we strive to provide as high an EPC rating as possible for our buildings, with our latest completed development achieving an EPC rating of C – a PDR development that converted a Victorian heritage building in Manchester into 18 luxury apartments on Deansgate.
In addition to achieving a high EPC rating, our developments are also fitted with high grade insulation to ensure the building’s heat is retained for redistribution throughout the building, high-quality appliances and flooring to minimise the need to replace furnishings and so less items end in landfill, and implement smart technologies such as underfloor heating and heat recovery systems to keep energy bills low and reduce our carbon output.
To learn more about how you can invest with a developer that keeps sustainability at the heart of their development process and future-proof your investment property, get in touch with our expert team today.